Home loans to drive biz in coming quarters: IIFL

New Delhi: IIFL Finance’s growth in Q3 FY26 was driven by a sharp rebound in gold loans, while momentum in mortgages—home loans and loans against property—is expected to strengthen in the coming quarters, its managing director Nirmal Jain said.

Home loan AUM rose 5 per cent to Rs 31,893 crore, while gold loan AUM rose 189 per cent to Rs 43,432 crore in Q3 FY26. These secured segments now form the bulk of the loan book, marking a shift away from higher-risk and more volatile portfolios that had earlier weighed on performance, Jain said.

“This rebalancing has helped stabilise cash flows and reduce earnings volatility,” he said, adding that asset quality improved sequentially, with gross and net NPAs declining across businesses and provision coverage remaining elevated.

Gross NPAs moderated to 1.6 per cent from 2.4 per cent at end-December 2024, while net NPAs eased to 0.8 per cent from 1 per cent in Q3 FY25. Credit costs have begun to soften as legacy stress runs down, with further normalisation expected as secured lending scales up.

Jain said operating leverage is beginning to kick in, supported by a large physical distribution network, technology and AI-led workflows, and expanding bank partnerships through co-lending and direct assignments.